The Business of Circular Business Models

“It’s about resource efficiency, not just capital efficiency.”— Marc Wandler

A business model is a blueprint to help companies define how to run their business best. Companies refine their products and manage to the original model as they grow. Sometimes, they miss disruptive innovation opportunities because they focus on everyday experiences. Innovative companies are more fortunate to be nimble and have the latitude to explore all market distribution channels. 

Defining Circular Business Models                                          

Circular business models are focused on “designing out” the waste while creating efficiencies. The goal is to set up a business that helps remove the negative impacts on people's environment and social welfare. A Vancouver, Canada, potato farmer named Potato Tyy runs Ten Servings Corporation. Instead of tossing ugly potaoes and squash from his farm, he sells the imperfect product wholesale and retail to the local community. With all the leftovers, he offers an opportunity for his customers to donate a meal, or series of meals, to families in need. The program is designed to remove waste and reuse it constructively.  

Anatomy Of A Circular Model

Agro-Environmental Circular Business Models

Companies are recovering raw materials, like mushrooms - better known as mycelium to implement a durable, leather-free product in luxury cars.  Farmers are driving the growth of the mushroom industry past specialty products into mainstream manufacturing systems. Even Toyota is getting in the mix by changing to vegan-based (mushroom) seating in their family cars. 

In Denmark, they take all whey by-products and convert them into milk powder, which is used in mass food production and has a long shelf-life. Grass, clover, and alfalfa are high sources of protein being grown, adding carbon back into the soil and providing a rich source of feed for animals.  Finally, residual potato starch, from manufacturing is being recycled into consumer packaged products and animal feed. 

Classification of Circular Models